One time, Microsoft thought about putting out an Xbox One that was all digital

OXM interviewed Phil Spencer and in there, Phil mentioned that at Microsoft considered a disc drive-less Xbox One. In fact, they thought about this up until late 2013.

That route would have meant no more physical media for the console which would have eliminated any capability to play Blu-Ray movies or buy disc based games in stores.

Which, to me, is kind of odd because of Microsoft's drive to dominate the living room space. Blu-Rays are still a much higher quality audio and video experience than streaming movies and I would think they would want to provide this option for those that are really into movies.

Now with games, the size of the downloads would hamper a lot of folks with both speed and cap restrictions. A game or two and some movies would hit that cap pretty quickly in many places.

Until we have reliable broadband everywhere without cap restrictions, the notion of an all digital console system is probably out of the question, although I'm sure there's a market for them.